Deficit down, government debt up in August 2010 – NSO

In fact, according to the NSO, the deficit for the first eight months of 2010 stood at €275.4 million.

The NSO reported that the increase in total expenditure of €86.2 million was offset by a rise in recurrent revenue of €155.8 million.

However, central government debt at the end of August 2010 rose by 6.8 % (+€268.9 million) when compared to the same period last year, reaching €4,246.6 million.

According to the NSO, long-term borrowing, making up 84.0% of Government debt, rose by €365.2 million. On the other hand, short-term securities and foreign borrowing decreased by €86.5 million and €12.8 million respectively.

During the first eight months of the year, recurrent revenue increased by 11.5%, reaching €1,509.9 million at the end of August 2010.

The comparative increase was “mainly the result of higher returns from VAT (+€40.0 million), customs and excise duties (+€32.2 million), grants (+€23.9 million) and income tax (+€21.5 million).

However, the NSO reported a decline of €8.1 million in licences, taxes and fines when compared to the same period last year.

Total expenditure for the period increased by 5.1% when compared to the same period last year, reaching €1,785.3 million, as a result of more outlays on recurrent and capital expenditure.

According to the NSO, the increase in recurrent expenditure was triggered by, among others, higher spending on social security benefits by €27.8 million, the reclassification of the Malta Tourism Authority from capital to recurrent expenditure which amounted to €21.1 million, a rise in personal emoluments of €19.6 million, higher budgetary compensation in respect of energy support measures by €13.5 million, and an increased allocation in respect of local councils by €9.0 million.

On the other hand, declines in recurrent expenditure were recorded in the shipyards' voluntary retirement schemes (-€17.6 million) and in medicines and surgical materials (-€15.1 million).

The NSO also reported that capital expenditure for the first eight months of 2010 increased by €33.5 million.

This was mainly due to increases relating to the Malta south sewage treatment infrastructure of €15.8 million and an amount of €10.0 million in connection with the introduction of the Jeremie financial engineering fund.

Further capital growth was registered by the transfer of €24.8 million to the treasury clearance fund.

According to the NSO, these were “in part outweighed” by the reclassification of the MTA.

Furthermore, the NSO reported that the interest component of the public debt servicing costs for the first eight months of 2010 went slightly down by €1.9 million, from €135.2 million in January to August 2009 to €133.3 million this year.

The euro coins issued in the name of the Maltese Treasury rose by €3.9 million when compared to the euro coin stock at the end of August 2009, reaching.€40.4 million.